By Anna De La Cruz, Senior Advisor to the Linked Foundation
The 2015 Foro Latinoamericano de Inversion de Impacto (Latin American Impact Investing Forum) held February 22-24 in Merida, Mexico, was much more than a chance to visit a lovely colonial city on the Yucatan peninsula. The annual forum, held by New Ventures Mexico, is an opportunity for innovators across the impact investing space to come together to share ideas, successes, challenges and form partnerships in their quest to create social change in Latin America in a sustainable way. Those present represented a wide range of sectors including health, education, the environment, financial inclusion, housing, agriculture/food systems and beyond.
From the Linked Foundation perspective, the conference was an opportunity to learn about some of the latest health enterprise models in the region, connect with potential partners and entrepreneurs, and share what we’ve learned through our work – particularly in social franchising for health. Here are four big-picture reflections we took away from our week in Merida:
- Investors and practitioners are hungry for models that can be replicated and have the potential to be scaled locally and regionally. The first step in social innovation is usually to find solutions to specific problems that work, and the question about how to scale them comes later. More and more, and particularly in the impact investing space, people are seeking out solutions that contemplate scale from the beginning. Linked Executive Director Nancy Swanson, Linked Senior Advisor and University of Michigan Law Professor Deborah Burand, Rafael Ayala of Masisa and I all participated on a panel on social franchising, moderated by Silvia Mancilla of Fundes. We were pleasantly surprised by the number of people interested in using a social franchise model, wanting to learn from our experiences, and voicing thoughtful (and difficult) questions about scale.
- Supporting entrepreneurs goes well beyond providing capital. Access to financing is a critical input that social entrepreneurs need in order to catalyze their vision. However, things like access to training, mentorship, a dynamic team of advisors, technical assistance in areas like M&E, public and private partners who can compliment and support new innovations are also critical to success. In fact, we learned that many entrepreneurs would prefer to work with finance partners who are more involved and offer more to the partnership than capital. Which leads to our next takeaway…
- No one wants to tackle these issues alone. FLII attendees encompass the full impact investing ecosystem, from individual social entrepreneurs and investors, to accelerator programs and private firms interested in producing shared value, to foundation and fund investors and social and government organizations. One of the most impressive and valuable aspects of FLII is to see and participate in the way people are partnering across sectors and using systems thinking to inform and strengthen their work. Entrepreneurs are applying principles from design thinking, traditional business, collaborative economies and the non-profit sector to be stronger from both a business and social outcomes perspective. Nancy, along with our colleague Peter Loach from Mercy Corps Guatemala, had the opportunity to share during the closing ceremony how FLII has facilitated connections between Linked, Mercy Corps, Farmacias de la Comunidad in Guatemala and Farmacias Similares in Mexico and through these partnerships, supported the development of two rural pharmacy franchise models.
- The impact investing world talks a lot about social impact, but few are actually measuring it (yet). At Linked we like to keep asking ourselves what we want to be toasting to in ten years. How will we know we’ve influenced positive social change beyond the number of people served or number of products delivered? What is our social bottom line? For entrepreneurs and investors tackling social issues through enterprise, I think most are asking this question, but few are able to answer it with confidence. As a foundation, we see part of our role as one of strengthening models by investing in M&E with our partners and continuing to ask these tough questions. The ANDE metrics workshop provided an opportunity to discuss the challenges, barriers and some next steps for more meaningful evaluation of social enterprise.
The social entrepreneurship space is taking off, with all eyes on where it is headed. The FLII crowd is at the forefront, and we’re glad to be part of it.